Metered Access

Crain's Detroit Business is a metered site. Print and digital subscribers have unlimited access to stories, but registered users are limited to eight stories every 30 days. After viewing three metered stories, you'll be asked to register or log in. After eight more stories in 30 days, you'll be asked to subscribe.

Starwood Capital Group LLC, the investment firm run by Barry Sternlicht, agreed to buy seven U.S. malls from Bloomfield Hills-based Taubman Centers Inc. for about $1.4 billion to expand its retail holdings.

Starwood will pay $785 million in cash and assume $620 million in debt, according to a statement today from the companies. The properties include The Mall at Partridge Creek in Clinton Township, Fairlane Town Center in Dearborn, MacArthur Center in Norfolk, Va., and the Shops at Willow Bend in Plano, Texas.

Starwood, based in Greenwich, Conn., has been building a retail real estate company through acquisitions as the U.S. economy improves. In November, it purchased a majority stake in seven malls from Westfield Group, following a similar transaction with the Sydney-based company in 2012. The deal with Taubman will expand the business to 28 properties in 15 states, Sternlicht said today.

“The Taubman portfolio broadens our relationships with higher-end department stores and in line tenants and gives us an excellent opportunity to continue to produce attractive returns for investors,” he said in the statement.

Taubman Centers owns, leases and/or manages 27 retail properties in 15 states and South Korea, according to a news release. The company reported mall tenant sales per square foot of $721 in 2013 and upon completion of these transactions, expects its mall tenant sales to increase by more than $100 per square foot, according to the release.

"The seven centers we are selling are strong properties that fit well within the Starwood portfolio and will continue to thrive under their management," said Robert S. Taubman, chairman, president and CEO of Taubman Centers, in the release.

Other Taubman properties include Twelve Oaks Mall in Novi and Great Lakes Crossing in Auburn Hills.

Taubman's share of cash and property level debt are expected to be $765 million and $595 million, respectively, the release stated. Taubman was represented by Eastdil Secured LLC. Closing is expected to occur in the fourth quarter of 2014.